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CInSt Research Seminar "Rules, discretion and corruption in procurement: Evidence from Italian government contracting": Francesco Decarolis (Bocconi University)

Francesco Decarolis (Bocconi University) is going to present a paper "Rules, discretion and corruption in procurement: Evidence from Italian government contracting" on the regular CInSt research seminar on June, 24

Abstract
The benefits of bureaucratic discretion depend on the extent to which it is used for publicbenefit versus exploited for private gain. We study the relationship between discretion andcorruption in Italian government procurement auctions, using a confidential database of firms and procurement officials investigated for corruption by Italian enforcement author-ities. Based on a regression discontinuity design around thresholds for discretion, we find that, overall, a large increase in the use of discretionary procedures in the 2000s led to aminimal increase in auctions won by investigated firms. To understand this ‘non-result,’we further investigate the attributes of “corrupted” auctions. We show that discretionaryprocedure auctions are associated with corruption only when conducted with fewer than theformally required number of bidders; similarly, discretionary criteria (“scoring rule” ratherthan first price) auctions are won more often by investigated firms. We further show that these “corruptible” discretionary auctions are chosen more often by officials who are them-selves investigated for corruption, but less often in procurement administrations in which at least one official is investigated for corruption. These findings fit with a framework inwhich more discretion leads to greater efficiency as well as more opportunities for theft, and a central monitor manages this trade-off by limiting discretion for high-corruption pro-cedures and locales. Additional results based on two standard tools for curbing corruption – turnover and subcontracting limits – corroborate this interpretation. Overall, our resultsimply that discretion is under-utilized, given the high potential benefits as compared to the modest increment in corruption

Time: 18:10-19:30 (UTC+3).  
Location:  Online in Zoom
Working language: English.    
The link to join   Zoom:  https://zoom.us/j/7488279147
Here is the instruction about how to join the seminar in  Zoom:  https://cinst.hse.ru/en/news/350230570.html

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